High versus Low Inflation: Implications for Price-Level Convergence

Ege Yazgan () and Hakan Yilmazkuday

No 1503, Working Papers from Florida International University, Department of Economics

Abstract: This paper investigates the relationship between the level of inflation and regional price-level convergence utilizing micro-level price data from Turkey during two clearly distinguishable periods of high and low inflation. The results indicate that higher persistence and slower convergence of price levels are evident during the low-inflation period, which corresponds to the inflation-targeting (IT) regime that was successful in lowering and maintaining inflation at acceptable levels. During this low-inflation IT regime, it is also shown that inflation convergence across regions appears to occur more quickly and may be responsible for the slower pace of convergence in price levels.

Keywords: Price Convergence; Inflation Convergence; Micro-level Prices; Turkey (search for similar items in EconPapers)
JEL-codes: E31 F41 (search for similar items in EconPapers)
Pages: 32 pages
Date: 2015-05
New Economics Papers: this item is included in nep-ara, nep-cba, nep-cwa, nep-mac, nep-mon and nep-opm
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://economics.fiu.edu/research/pdfs/2015_working_papers/1503.pdf First version, 2015 (application/pdf)

Related works:
Journal Article: High versus low inflation: implications for price-level convergence (2016)
Working Paper: High versus Low Inflation: Implications for Price-Level Convergence (2014)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:fiu:wpaper:1503

Access Statistics for this paper

More papers in Working Papers from Florida International University, Department of Economics Contact information at EDIRC.
Bibliographic data for series maintained by Sheng Guo ().